Everton in 'secure financial position' despite £121m losses
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Everton majority shareholder Farhad Moshiri and chairman Bill Kenwright have faced criticism from fans this season for the way they run the club, which led to the sacking of Rafael Benitez
Everton "remain in a secure financial position" thanks to owner Farhad Moshiri despite posting losses of more than £110m for a third straight season.
The Premier League club, who are just three points above the relegation zone, registered losses of £120.9m for the 2020-21 season.
However, £103m of that figure is attributed to the impact of Covid-19.
That comes after previous losses of £111.8m and £139.8m for the two previous seasons.
That makes a combined loss of £372m over three years, but the club say Covid-19 losses over the past two years amount to £170m, including last season where games were played behind closed doors.
Premier League profitability and sustainability rules mean that clubs are only allowed combined £105m losses for three seasons.
But clubs are allowed to adjust figures to account for the past two Covid-hit seasons, meaning their actual losses are about £170m.
That does not include spending on Everton's new Bramley-Moore Dock stadium, the academy and women's team, plus community projects, which are taken off the costs total and, Everton say, bring the club under the £105m limit.
The club also said they had been "working formally with the Premier League regarding its ongoing compliance with profitability and sustainability regulations".
Everton have also benefited from cash injections from majority shareholder Moshiri at a time of added uncertainty.
Last season's accounts show a £100m cash injection from the Iranian businessman, who has pumped more than £600m into the club since he first bought shares in Everton in 2016. He has since followed up with further £97m earlier in the 2021-22 season and increased his stake in the club to 94.1% in January, which injected another £100m into the club.
In addition to the threat of relegation, Everton have suspended their sponsorship deals with Russian companies USM, Megafon and Yota, who are all owned or part-owned by billionaire Alisher Usmanov, who is a close business partner with Moshiri.
The suspension came after Usmanov was sanctioned, with the loss of the sponsorships likely to cost around £5m-£10m a year. USM had also paid £30m for an exclusive naming rights option on the new 52,000-seat stadium, which is set to open in the 2024-25 season and is likely to cost over £500m.
Last season's wage bill, which included the now departed Colombian winger James Rodriguez, who earned more than £200,000 a week, rose from £165m in 2019-20 to £182m.
It also included manager Carlo Ancelotti, who left for Real Madrid last summer before he was replaced by Rafael Benitez. Overall, wage-to-turnover ratio increased from 89% in 2019-20 to 95% in 2020-21, but included added staff costs during the pandemic.
Despite those financial concerns and recent losses, Everton said they had a record turnover last season of £193.1m and "remains in a secure financial position thanks to the continued unwavering support and commitment of Farhad Moshiri and cost control measures continuously adopted by the club".
They added that the club had "experienced a unique set of financial circumstances in recent years" including "committing significant amounts of expenditure to a complex new stadium project" and dealing with the impact of Covid-19, "all whilst being in the initial stages of an investment cycle thanks to the support of [Moshiri]".
The club hope the move to a new stadium, which could come mid-season, will boost matchday revenue and commercial income to a level where it they are less reliant on cash injections from the majority shareholder.
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